Apple TV's YouTube app finally gets an overhaul that delivers new features like predictive search to the Apple set top box, while bringing back dollars to Google in the form of ads.

Along with predictive search, the latest version of Apple TV's YouTube app features recommendations and the ability to subscribe to channels. The app was reskinned so it now looks the part of a product released by Google.

But the YouTube app's most notable feature may be the inclusion of ads, an element that permeates every other version of the streaming video service's software. Apple TV had been free of ads until this point, but now Google is taking the opportunity to make money off its rival's fans.

Google's move to finally blend ads into Apple TV's YouTube app comes as the search engine company's own streaming hardware has finally surpassed the Apple device. Not even in the top five in 2013, Google's Chromecast has surged into second place past Apple and Sony.

While Apple TV's shipments continue to rise, the set top box has been losing large amounts of market share to new entrants into the sector.

Apple's share of the market for streaming hardware fell from 26 percent in 2013 to 17 percent in 2014, according to a recent report from Parks Associates. Meanwhile, Google's Chromecast appeared for the first time in the top five with a 20 percent slice of the market and Amazon, with its 10 percent share, also broke into the top of the field.

About half of the video U.S. households consume is in nonlinear format, a figure that's up from around 38 percent in 2010, states Barbara Kraus, director of research at Parks Associates. While Kraus didn't suggest a cause for the Apple TV's lagging sales, she pointed out Apple is the top player that has yet to embrace the streaming stick form factor.

"The market is changing rapidly to account for these new digital media habits," says Kraus. "Roku now offers a streaming stick, and Amazon's Fire TV streaming stick leaves Apple as the only top player without a stick product in the streaming media device category."

Though Apple hasn't embraced the streaming stick design just yet, the vendor is constantly looking for ways it can improve the TV experience, said Apple CEO Tim Cook in a September review. Cook didn't offer many details, though he implied there are some products in the works that are looking to push the evolution of TV.

"Think about how much your life has changed, and all the things around you that has changed," said Cook. "And yet TV, when you go in your living room to watch the TV, or wherever it might be, it almost feels like you're rewinding the clock and you've entered a time capsule and you're going backwards. The interface is terrible. I mean, it's awful!"

Take a look at the video announcement of the new features headed to Apple TV's YouTube app:

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